Jack Kemp

Former pro football quarterback, former congressman, former HUD Secretary and 1996 Republican vice presidential nominee Jack Kemp died on Saturday of cancer at age 73. He may have been the most influential American politician in history who never became president.

Kemp and his mentor, Ronald Reagan, were very much alike. Both had achieved great success in fields completely removed from politics long before launching a political career--Kemp in sports and Reagan as an actor. And although neither had much in the way of formal education--both graduated from second-tier colleges and had no post-graduate degrees--they were both extremely well read and profoundly interested in ideas.

Reagan always said that he was able to cope with the pressures of the presidency more easily than some of his predecessors because he never viewed it as the pinnacle of his professional life; he was proud of his career in Hollywood and was accustomed to the glare of publicity. Kemp felt the same way about his years as a member of the Buffalo Bills. He always said that, when you have been booed simultaneously by every person in a stadium filled to capacity, the sorts of slings and arrows politicians face were pretty tame.

I remember that Kemp used to have a huge picture right next to his desk in his congressional office. It showed him in his football days with some really, really big lineman--Ernie Ladd, I believe--getting ready to plaster him to the ground. I think that picture always reminded him of how quickly one can go from being the star to being flat on your back. It kept him grounded--no pun intended.

When I first met Kemp, it was late in 1976. I had applied for a job in his office as the staff economist and he interviewed me as he was putting on a tuxedo to attend the last formal event of Gerald Ford's White House.

Frankly, I didn't know much about Kemp except for his football exploits. I clearly remembered him from the 1965 AFL championship game. As a player, he always struck me as someone without that much raw talent, but who compensated for it with grit, intelligence and leadership. The same might be said of his political career as well.

When I met Kemp, he had only been in office for three terms, having been elected in 1970. (He always joked that his threat to play for the Bills another year is what put him over the top.) From what I could tell, national defense was really his big issue. Kemp was a member of the defense appropriations subcommittee, where he had been a strong supporter of the Vietnam War.

But by 1976, the war was over and America's weak economy was really its most serious national security problem. Kemp understood that unless the U.S. economy was strong it wouldn't have the resources to counter and defeat Soviet communism, which was at the pinnacle of its power at that time.

Kemp was fortunate that the staffer he had hired to do national defense for him was a Ph.D. economist named Paul Craig Roberts. Craig started developing some legislative initiatives for Kemp that pulled together various strains of conservative economic thought, such as monetarism and public choice.

Kemp was also fortunate to have as his chief of staff a lawyer with a background in taxation named Randal Teague. Randy had been executive director of Young Americans for Freedom--a conservative youth group founded by Bill Buckley.

Randy got the idea for a tax bill that would have built-in lobbyist support. He told me that he contacted various business groups and asked them what their No. 1 favorite tax cut would be and Randy simply packaged them together into a big tax bill. One of the groups hired economist Norman Ture to do an analysis of the bill, which was called the Jobs Creation Act, and it showed enormously positive economic effects.

But Kemp was not entirely happy with a purely business tax cut. He wanted to do something for people. I believe it was Jude Wanniski, then an editorial writer for TheWall Street Journal, who explained to Kemp that all taxes are ultimately paid for by people; taxes on corporations are simply passed through to the shareholders. Therefore, cutting tax rates on individuals was just as good for the economy as tax cuts for businesses.

Wanniski brought Kemp into contact with University of Chicago economists Robert Mundell and Arthur Laffer. They encouraged Kemp to focus tax cuts on individuals and--most importantly--to concentrate on reducing marginal tax rates. The marginal tax rate is that on the last dollar earned and the rate that primarily affects economic incentives. Other tax cuts were essentially worthless, Mundell and Laffer said.

Wanniski also told Kemp about the historical experience with tax cuts that he learned from Herb Stein's Fiscal Revolution in America. Wanniski explained that in the 1920s the Republicans had been the party of tax cutting; indeed, they argued that tax cuts could so expand the economy that the government wouldn't even lose any revenue. (Wanniski once told me that the first time he ever heard this idea, which came to be called the Laffer Curve, was when he read it on page nine of Stein's book.)

Of even greater political relevance was John F. Kennedy's big tax cut, which was rammed through Congress by Lyndon Johnson after his death. This legislation had reduced the top rate to 70% from 91% and the bottom rate to 14% from 20%.

Just before I went to work for Kemp, he had asked the Congressional Research Service what the revenue effect of Kennedy's tax cut had been. The CRS data showed that, despite the tax cut, federal revenues increased.

One day in early 1977, Kemp told me that we should abandon the gimmicky tax cuts embodied in the Jobs Creation Act and just replicate the Kennedy tax cut. He told me to draft a new bill along these lines. After consulting with Ture, who had worked for House Ways and Means Committee Chairman Wilbur Mills while Mills was managing the Kennedy tax cut in the House, and others, I concluded that reducing the top rate to 50% from 70% and the bottom rate to 10% from 14% would roughly replicate the Kennedy tax cut.

At about this time, Kemp got a note from Senator Bill Roth of Delaware suggesting that they work together on something. We asked if he was interested in cosponsoring the reconstituted Kennedy bill we had been working on. He said yes and the Kemp-Roth bill was born. Among the first congressmen to cosponsor the bill was Rep. Dave Stockman of Michigan, who functioned almost like an adjunct Kemp staffer; our two offices were like one on this issue.

Kemp-Roth came along at just the right time. The Republican Party was moribund--even more so than today--and had little to offer on economic policy except the balanced budget. Kemp viewed this as an inherently defensive position that had no chance of victory; tax cuts put the party on offense.

Reagan, who had lost the Republican presidential nomination to Ford in 1976, was attracted to the idea of cutting tax rates--he remembered too well how much of his movie star income had gone to Uncle Sam during World War II. Kemp had worked for him in the California governor's office as a special assistant during the off season, and he worked hard to get Reagan to endorse Kemp-Roth, which he did, making it the heart of his successful 1980 campaign for president.

The rest, shall we say, is history. Reagan won and got Kemp-Roth enacted in 1981. After this, Kemp turned his attention to the flat tax and got Reagan to endorse a version of that as well, which was enacted by Congress in 1986, bringing the top statutory income tax rate down to just 28%.

On the basis of this history, it is reasonable to say that between 1976 and 1986 no individual had more impact on U.S. tax policy than Kemp. Amazingly, during this whole period, he was never even a member of the tax-writing Ways and Means Committee. And to this day, Kemp's ideas form the foundation of Republican economic policy--quite an accomplishment for a self-professed "dumb jock" with a college degree in physical education.

Bruce Bartlett is a former Treasury Department economist and the author of Reaganomics: Supply-Side Economics in Action and Impostor: How George W. Bush Bankrupted America and Betrayed the Reagan Legacy. He writes a weekly column for Forbes.com. (Tunku Varadarajan is not writing this week.)